Syngenta Revenue, Profit Drop in First Half of 2016

Posted by Dan Jacobs|22 July 2016

Despite falling earnings across most of its markets, including crop protection, during the first half of 2016 Syngenta remains optimistic about the takeover bid by ChemChina and the positive impact it can have on the company.

“The transaction with ChemChina will ensure continuing choice for growers at a time of industry consolidation,” said Erik Fyrwald, Chief Executive Officer. “We are having constructive discussions with all regulatory authorities which reinforce our confidence in closing the transaction by the end of the year. ChemChina’s long term commitment to the business will underpin our ongoing investment in innovation, so that growers will continue to benefit from our broad technology platforms for decades to come.”

Syngenta posted sales of $7.094 billion for the first half of 2016, a 7% drop compared with the same period last year. The crop protection segment were similar. The company had sales of $5.244 billion for the first half of 2016, an 8% drop compared with the 2015 results. Syngenta saw sales drops in nearly all divisions of crop protection including: herbicides, fungicides, insecticides, and seedcare.

“After a resilient first quarter, market conditions were more difficult in the second quarter, notably for the high margin Europe, Africa and the Middle East business,” Frywald said. “Looking at the prospects for the second half, we expect a return to growth in Asia Pacific with the recent easing of drought conditions in several countries. In Latin America, growers in Brazil continue to face economic uncertainty and credit constraints, although their underlying profitability remains robust. Group sales for the year are expected to be slightly below last year at constant exchange rates; reported sales are likely to show a mid-single digit decline due to the continuing strength of the dollar.

“The transaction with ChemChina will ensure continuing choice for growers at a time of industry consolidation. We are having constructive discussions with all regulatory authorities which reinforce our confidence in closing the transaction by the end of the year. ChemChina’s long term commitment to the business will underpin our ongoing investment in innovation, so that growers will continue to benefit from our broad technology platforms for decades to come.”